Quarterly report pursuant to Section 13 or 15(d)

Condensed Consolidated Statements of Cash Flows (Unaudited)

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)
 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Cash flows from operating activities:    
Net loss $ (13,305,999) $ (1,501,521)
Adjustments to reconcile net income to net cash used in operating activities:    
Depreciation and amortization 18,761 16,376
Stock based compensation 9,997,201 6,435
Discount amortization 4,592 34,813
Gain on sale of assets (2,426)   
Loss on abandonment of patents    542
Changes in assets and liabilities:    
Deposits and other assets 2,578 (177)
Prepaid expenses (52,421) 11,050
Inventory      
Accrued payroll and payroll related expenses (183,496) 163,026
Accounts payable (96,538) (52,228)
Accrued interest (101,553) (448,401)
Fees payable to directors (44,792) (32,648)
Patent license payable (10,000) (15,833)
Other current liabilities (12,613) (4,424)
Lease settlement payable    (190,000)
Net cash used in operating activities (3,786,706) (2,012,990)
Cash flows from investing activities:    
Purchases of property and equipment    (8,757)
Proceeds from sale of property and equipment 2,426   
Expenditures on patents (9,135) (13,334)
Net cash used in investing activities (6,709) (22,091)
Cash flows from financing activities:    
Proceeds from the issuance of common stock 3,923,100   
Proceeds from the issuances of notes payable 2,076,000 2,453,973
Repayment of principal on notes payable (550,408)   
Net cash provided by financing activities 5,448,692 2,453,973
NET INCREASE IN CASH 1,655,277 418,892
Cash at the beginning of the period 222,410 7,799
Cash at the end of the period 1,877,687 426,691
NON-CASH FINANCING AND INVESTING ACTIVITIES:    
Issuance of common stock warrants    358,003
Conversion of notes payable and accrued interest to common stock 11,125,167   
SUPPLEMENTAL DISCLOSURES:    
Cash paid for interest $ 188,382 $ 225,574